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T.C. 1207 (1948); Eagleton v. Commissioner, 35 B.T.A. 551 (1937),
affd. 97 F.2d 62 (8th Cir. 1938).
The record shows that on March 8, 1991, ETCO remitted a
check in the amount of $22,000 to TransAmerica via Mr. Sloan.
TransAmerica never presented the check to ETCO's bank for
payment. A second check for the same amount dated January 29,
1992, was made and remitted to TransAmerica to replace the lost
check dated March 8, 1991. The check dated January 29, 1992, was
ultimately returned to ETCO. Because neither of ETCO's checks
made payable to TransAmerica was presented and honored in due
course, it does not constitute payment, which would relate back
to an earlier date of the delivery of either check to
TransAmerica. Because none of the $22,000 checks made payable to
TransAmerica were presented for payment, we find that no payment
occurred, and ETCO is not entitled to a deduction in fiscal years
ending June 30, 1990 or 1991 under the cash basis method of
accounting.
Premiums for Life and Disability Insurance Policies
Respondent argues that ETCO is not entitled to the expense
deductions for life and disability insurance premiums in the
amounts of $6,345, $5,490, and $3,690 for the fiscal years ended
June 30, 1990, 1991, and 1992, respectively. Respondent contends
that ETCO was the owner and beneficiary of such policies. ETCO
contends that it is entitled to deduct the premiums paid during
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